How SGMA Will Affect Agricultural Groundwater Users and Key Considerations for Developing an Implementation Strategy

This article was originally published as an advertorial in the September/October 2017 print issue of Western Grower & Shipper, a publication ofWestern Growers.

The Sustainable Groundwater Management Act (SGMA) is now in its third year of operation. Groundwater Sustainability Agencies (GSAs) have been formed throughout the medium- and high-priority basins across California and those GSAs are now beginning to develop Groundwater Sustainability Plans (GSPs). The GSPs will afford greater long-term groundwater supply reliability by avoiding chronic groundwater depletion and other “undesirable results,” such as significant loss of storage, water quality degradation, subsidence, and seawater intrusion. To achieve sustainable management, groundwater extractions will need to be reduced in many basins experiencing overdraft conditions.

Basin Adjudications as Precedent. Prior court actions to adjudicate groundwater rights and manage overdrafted basins—mostly in southern California—offer some insight into how GSPs may be structured. In several cases, the courts allocated groundwater supplies among diverse users based on an assessment of groundwater rights and then reduced allocations over time to eliminate overdraft. Many judgements also addressed pumping assessments to fund basin replenishment activities, trading of allocations, carryover of unused allocation from year to year, and storage of non-native water in the basin’s available storage space. We anticipate similar provisions in future GSPs under SGMA.

Overdraft Curtailment. An initial consideration in framing a GSP is the extent of basin overdraft and the time frame for overdraft curtailment. SGMA requires that a basin be managed to avoid specified undesirable results associated with prolonged overdraft within 20 years of plan implementation. Thus, a GSP can structure a gradual reduction in extractions over time. The plan will depend, of course, on the assessment of undesirable results to be avoided, basin hydrogeology, minimum thresholds, and basin replenishment opportunities.

Allocation of Pumping Rights. How and to whom pumping allocations are made will often be the most controversial issue. SGMA allows GSAs to issue allocations as a management tool, but it also instructs that SGMA does not usurp groundwater rights existing under the common law. Therefore, allocations established in GSPs will need to be consistent with common law groundwater rights to withstand legal challenges. Groundwater rights are generally characterized as either overlying, appropriative, or prescriptive. Overlying rights, which accrue from land ownership, are senior in priority to appropriative rights, which apply to non-overlying uses including municipal water service. Thus, initially, overlying landowners have first call on available groundwater. Appropriative rights, however, can ripen into prescriptive rights in basins that have experienced notorious and protracted overdraft, giving prescriptive rights holders an equal claim to that of the overlying landowners. Therefore, a landowner’s strategy must consider whether appropriative rights have ripened into prescriptive rights as a consequence of extended overdraft.

Where groundwater use is predominantly agricultural, allocations among landowners will be a prominent consideration. Overlying rights are generally deemed correlative or equal in nature. Each overlying landowner is entitled to its reasonable, correlative share of the supply. The division of limited basin supplies between landowners is a fact-specific inquiry in the law with considerations oriented toward reasonableness and equity. Historically, courts have held that a landowner that has been pumping for an extensive period has no greater right than one that only recently commenced pumping, or never produced groundwater. However, more recent developments in the law suggest that groundwater use by landowners will likely be capped and limited, and the treatment of so-called “dormant” overlying rights and allocations between landowners generally is an evolving area of the law.

A groundwater user can also possess a right to non-native groundwater in the basin resulting from intentional replenishment with non-native water or return flows from surface applications of imported water. These rights generally afford the benefited party an exclusive right to the augmented yield attributable to their activities. This issue will likely be particularly important where return flows from applied imported surface water are a substantial portion of the basin’s yield.

The discussion above is only a brief introduction to the issues that will arise as SGMA is implemented. Landowners should solicit a detailed legal analysis of their groundwater rights as well as basin conditions to assess likely outcomes and develop a prudent strategy for participation in the GSP development process.